ICM Aims to Head Off Intern Class Action by Bringing Arbitration Claim (Exclusive)

The agency is looking to preempt a threat by a former intern in its New York office.

So far, the flood of litigation over unpaid internship programs hasn't hit the inner sanctum of Hollywood talent agencies, but that doesn't mean there aren't efforts underway to recruit potential plaintiffs. Now ICM Partners is looking to stay ahead of the curve by bringing one of its ex-interns to arbitration.

A demand for arbitration was filed against a former intern on Friday, The Hollywood Reporter has learned, adding a new wrinkle to the ongoing internship legal controversy. To date, Fox Entertainment, NBCUniversal, Warner Music and Sony are just a few of the companies that have been hit with lawsuits from former interns alleging violations of wage and overtime laws.

The Fox dispute covering internships on the Oscar-nominated film Black Swan has been particularly influential after a federal judge determined that the company was the "employer" of two former interns as that term is defined in the Fair Labor Standards Act. Last June, that same judge also certified a class action over internships throughout Fox's corporate departments. The ruling is on appeal.

Success breeds imitation, especially among class-action lawyers. This is especially true in regards to the issue of unpaid internships, which for some lawyers, is a social justice one.

Hollywood talent agencies, which often have robust internship programs, could make for a juicy target.

According to sources, one former female intern in ICM's New York office has been making litigation threats and has brought lawyers on board to represent her.

Now, ICM wants to cut her off at the courthouse gate. The agency, represented by the Proskauer law firm, believes its internship program is purely educational and that interns are not tasked with replacing the duties performed by employees. So it's being proactive against the former intern.

The arbitrability of a dispute where an intern claims to be an employee isn't something that has been adjudicated, as far as we're aware. In fact, in response to the Black Swan case, some employment lawyers have been advising companies to get interns to explicitly agree to arbitration as a condition of bringing them on.

Although the major Hollywood agencies like ICM have thus far escaped the wrath of former interns, there has been one case against an agency. In May, Elite Model Management announced a settlement -- the largest to date over the issue of internships. According to the terms, 150 of its ex-interns were guaranteed a minimum payment of $700 up to $1750 for their time worked at Elite. In total, the modeling agency paid $450,000 to settle claims.